Israel Considers Military ‘Upgrade’

JERUSALEM—Israel will need to boost military spending and may seek an additional $20 billion in U.S. security assistance to help it manage potential threats stemming from popular upheavals in the Arab world, Defense Minister Ehud Barak said Monday.

Still, he said Israel shouldn’t fear changes in the region or the risk of offering bold concessions in a renewed bid to achieve peace with the Palestinians.

« It’s a historic earthquake…a movement in the right direction, quite inspired, » Mr. Barak said in an interview with The Wall Street Journal, surveying the youthful revolts in Egypt, Tunisia, Libya and the Gulf. « It’s a movement of the Arab societies toward modernity. »

In the short term, however, Israel worries that adversaries Iran and Syria « might be the last to feel the heat » of regional unrest, he said, and that public pressure could push new leaders in Egypt away from that country’s 1979 peace treaty with the Jewish state.

« The issue of qualitative military edge for Israel becomes more essential for us, and I believe also more essential for you, » said Mr. Barak, a former prime minister. « It might be wise to invest another $20 billion to upgrade the security of Israel for the next generation or so….A strong, responsible Israel can become a stabilizer in such a turbulent region. »

Defense analysts say Israel spends about 9% of its gross national product on defense, or roughly $17 billion per year. U.S. military assistance accounts for $3 billion of that. Mr. Barak said Israel faces no imminent threat but would have to increase its spending over the long-term.

He said it was too early to judge whether Iran is exploiting the regional unrest to its benefit. But before the revolts erupted in January, he said, « you could see Arab leaders starting to hedge their bets on who is the strongest leader here, Iran or the United States. »

He said he believes Egypt will respect the peace treaty and continue security cooperation with Israel « for the time being. » He said he has spoken by telephone with his Egyptian counterpart, Field Marshal Mohamed Hussein Tantawi, chief of the military council that replaced President Hosni Mubarak.

Messrs. Tantawi and Barak met about 15 years ago and discovered that they had fought on opposite sides in a fierce tank battle in the Sinai desert during the 1973 war. Mr. Barak said he told the Egyptian leader on the phone last month that « we have a responsibility to avoid that our young people fight again. »

In the interview, Mr. Barak described a recent warning from another prominent Egyptian, whom he didn’t name, that Israel could expect a different attitude unless it moved to make peace with the Palestinians. « He told me, ‘We’re going to have a really open election….Civic parties will hire advisers from the U.S. and Europe and find immediately that what can bring them voters is hostility to America and Israel.' »

Mr. Barak raised Israel’s concerns with Defense Secretary Robert Gates in Washington last month and is due to meet him again in Israel in late March. With the Obama administration pressing Israel and the Palestinians to resume U.S.-mediated talks that broke off last September, Mr. Barak said Israel could not seek pledges of additional military aid without making a « daring » peace offer.

Israeli officials are debating elements of a peace initiative, he said, and Prime Minister Benjamin Netanyahu is expected to announce one soon. Mr. Barak said Mr. Netanyahu is likely to offer the Palestinians a provisional state with temporary borders before tackling other core issues of the conflict, such as the fate of Palestinian refugees and rival claims to Jerusalem.

Palestinian Authority officials said they would reject such an offer. Mr. Barak, a dovish gadfly in a conservative-led government, said Israel or the United States would have to assure the Palestinians that a full-fledged agreement on statehood is in the offing.

Corrections & Amplifications

Israel’s Defense Minister Ehud Barak said, « The issue of qualitative military edge for Israel becomes more essential for us, and I believe also more essential for you. » An earlier version of this article incorrectly quoted Mr. Barak as saying « qualitative military aid for Israel. »